2016 FHA Program Qualifications First Time Home Buyer

FHA minimum credit score is 500. New FHA policy requires a minimum
credit of 500 to buy a home or refinance. In the old days FHA did not
require any credit score. These changes went in to effect in 2010.

To buy a home you will need a minimum credit score of 500.

Borrowers with credit score above 580 require a 3.5% down
payment. The down payment funds can be the borrowers own funds or a gift
from a family member and up to a 6% seller's concession is allowed.

FHA does not have a minimum trade line requirement.

FHA allows borrowers with no credit score to qualify for an FHA loan.

If your credit score is below 580 new FHA changes require a 10%
down payment. The down payment funds can be the borrowers own funds or a
gift from a family member and up to a 6% seller's concession is
allowed.

New FHA Collection Account Guidelines

FHA on April 2012 changed it's collection account guidelines. Going
forward all collection accounts within the last two years must be paid
off. All collection accounts totaling over $1,000.00 must be paid off.
Collection accounts that total less than $1,000.00 and are over two
years old may not have to be paid off.

If you have collection accounts that are not paid off - FHA
allows you to set up a payment arrangement to qualify. By setting up a
payment arrangement FHA will allow you to make three on time monthly
payments to qualify for a FHA loan.

Bankruptcy Foreclosure and Short Sale

Bankruptcy - At least two years must have elapsed since the discharge
date of the borrower and / or spouse's Chapter 7 Bankruptcy, according
to FHA guidelines.

Foreclosure - Foreclosure must have been resolved for at least 3 years with no late payments since the date of resolution.

Short Sale - FHA guidelines lets you qualify for a loan after
three years from a short sale. FHA guidelines requires three year past
from the date of sale of the property. If at the time of short sale your
mortgage payments were not late for the previous 12 months there is no
waiting period.

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